Friday, August 11, 2017

The pace of comics and graphic novel orders by North American comics shops worsened in July, according to data released today by Diamond Comic Distributors. Shipments for comic books, graphic novels, and magazines only reached a little over $41 million. That's down more than 19% from last year's blockbuster month for DC, when the publisher launched most of its Rebirth titles — but it's also down more than 11% from this June. All three of the months mentioned had the same number of shipping weeks.

While DC still had the most-ordered comic book in July with Dark Days: The Casting #1, the absence of Rebirth-launch-sized numbers meant the publisher joined Marvel as being behind for the year in North American orders, as measured by retail dollars. Marvel, which has been behind all year long, had accounted for all of the overall Direct Market shortfall in dollar terms up until June; now, with the market down $28.5 million for the year, Marvel represents only 70% of the drop. Marvel pared back its year-over-year losses some in July; while dollar orders were still off, they were off only half what they were in June.

Retailers ordered 6.95 million comic books in July, two and a half million copies fewer than last July, when the Rebirth comics were returnable. On the other hand, the year-to-date total remains at a competitive 53.05 million copies, off just 2.52%. And, yes, that figure includes a lot of 25¢ and free overship issues from early in the year, but on the other hand there's been no Loot Crate books to factor in so far.

Publishers also crammed a lot of new material into the comics shop channel, an event documented as it was happening by retailer Joe Field, who tweeted that shipments for the week of Comic-Con International had ballooned. We find that the number of new comics released in the month was up 7% over last July, and the number of new graphic novels released was up 13%. While the number of new items isn't that unusual in historical terms, retailers saw 45 more comics and 110 more new graphic novels over the last three months than they got in the corresponding months of 2016. Dollar sales for comics and graphic novels are off 12% in that period.

That graphic novel volume did count for something, as graphic novel dollar orders, led by Monstress Vol. 2, were off only 8.33%; even with a loss, it was the strongest category in July.

Percentage change figures for graphic novel dollars and units suggest that very little deep discounting is going on at the publisher level, a method that has often made the market look more robust than it actually is. What we're seeing now, thusly, is not inflated by a bunch of hardcovers shipped nearly for free, but is close to the actual retail demand.

The overall Direct Market stands at $302.21 million, which is around where it was in 2014 at this time, before Star Wars returned to Marvel. It is also off 8.69% year to date, which (as you'll see in the graphic much further below) puts it at the lowest position it’s been at in the month of July relative to the previous year since we got the data necessary to calculate changes in overall comics and graphic novel sales in 2003 and 2004. That said, it’srelative: July’s orders were larger than they were five years ago — a really good year! — and 65% higher than the same month in 2003. That’s not all coming from inflation. More periodical comics have been ordered through July in 2017 than in the year to date for every year of this century up to and including 2014. It's also worth remembering that comics shops buy graphic novels from more vendors than just Diamond, so their overall picture may be different.

The charts follow, after which there are some thoughts about where we find ourselves at this point in the year:

Dollars

Units

July 2017 vs. June 2017

Comics

-13.55%

-11.04%

Graphic Novels

-6.41%

-18.21%

Total Comics/GNs

-11.56%

-11.61%

Toys

-10.76%

11.81%

July 2017 vs. July 2016

Comics

-23.18%

-26.60%

Graphic Novels

-8.33%

-10.96%

Total Comics/GNs

-19.31%

-25.64%

Toys

-18.79%

-25.46%

Year-To-Date 2017 vs. Year-To-Date 2016

Comics

-7.01%

-2.52%

Graphic Novels

-12.39%

-13.18%

Total Comics/GNs

-8.69%

-3.41%

Toys

-5.09%

-9.26%

Helped by Walking Dead and Monstress, Image's market share was its highest in two years. The market shares:

So as we move further into the comparative months with 2016’s Rebirth and Civil War II, it’s worth discussing where we are — and how this summer’s downturn looks relative to others in the past.

Thelast real period of decline in comics began in earnest in 2009. The first decade of the 2000s had seen a vibrant recovery after the disaster of the 1990s; the graphic novel format surged to first supplement the periodical sector — and, with sales outside the Direct Market, surpass it in dollar terms. The Great Recession of 2008, however, combined with escalating prices and creative exhaustion to produce three years that were off — though very slightly: low single digits, percentage-wise.

The trajectory changed in the fall of 2011 with DC’s New 52 relaunch, which spurred several years of strong growth. By 2014, that rate of growth was leveling off — but in January 2015 another shot of adrenaline hit, with Marvel getting Star Wars, which added more than $30 million to the Direct Market that year on its own. And when the pace again began slowing down in the spring of 2016, DC’s Rebirth provided another booster shot.

There has been no booster shot in 2017 so far; not many big launches. In July 2016, a $50 million month, the average issue number in the Top 10 was 1.8, and the median was 1. Almost everything was a first issue, thanks to Rebirth. With no Marvel Legacy titles increasing the numbering, inJuly 2017 the average issue number in the Top 10 was 27.2, and the median 6.5.

As noted above, at this point in 2017, we’re back to around the size of the Direct Market at the same time in 2014. The last couple of injections, so to speak, have worn off, but the gains of the early part of the decade remain secure. It’s worth noting that even in the depths of the 2009-2011 slowdown — when the first top seller dropped beneath 100,000 copies, bottoming out in February 2011 with a bestseller only at 71,517 copies — conditions were still better than they’d been at the end of the 1990s, because we had the burgeoning trade paperback sector and a much stronger slate of middle-tier publishers. If hyperbole and panic were inappropriate then, they are more so, now — but it is an honest assessment to say that 2017 has been significantly underperforming, and by a rate that makes it less likely that the year will get back to even in the months remaining.

The graph below is one we haven't done before: it deals with year-versus-previous-year trajectories. It illustrates how the Year-to-Date Change figures have progressed every year since 2008. Years almost always begin quite a bit lower or higher than the previous year, because we're comparing Januaries which might or might not have an extra week. As the year progresses, however, that effect goes away and we see the the Year-to-Date Change figure finding the level that the year will end at. Of the five years that began in positive territory, only one — 2010 — wound up negative for the year. Of the four completed years that started out in the hole, all of them did rally — including last year, which managed to eke out a small net gain.

2017 could rally too, but as the graph shows, 2017 finds itself at a greater disadvantage as of July than in any previous year in the past 10. And while 2011 clearly did rally from nearly the same July level to get back almost to even, the 2017 market continues to face some challenging comparatives. The main one is next month: August 2016 saw more periodical comics shipped than any time in the Diamond Exclusive Era, so odds favor a repeat of this month's story. By September, however, the comparatives get somewhat easier; a string of $48 million months would mean no further year-over-year losses, and could bring the dip for the year back into line with the low-double-digit drops earlier in this decade. We just had a $48 million month in May, so it’s doable.

(A reminder: The graphic above depicts year-to-date percentage changes versus the previous year, not sales or copies sold. 2017's sales are above those for most of the other years on the graph!)

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